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The New Communications: Planning for Abundance

ISSUE:  Summer 1977

The bewildering array of crises, real and fancied, which buffet the public consciousness and preempt the attention of public policy makers—inflation, unemployment, energy, environment, health care, crime, urban decay—have tended to obscure other important public issues which, if less critical, cannot be ignored. Among such other concerns, the future of our communications system is emerging as one of the most important.

The vital role of communications in our society is such a commonplace that it could perhaps be passed over without comment. But, possibly because no crisis has riveted public attention on the pervasive influence of communications technologies and services in our lives, we take them largely for granted. There is no harm in that, provided we do not permit the comforts of our age to lull us into complacency about the social and economic role of communications, which grows in size, importance, and complexity each year. In some circles, it is claimed that what Daniel Bell has labeled the “post industrial society” has become an “information society.” One recent study indicates that as much as one half of the nation’s GNP and its labor force can be attributed to the production, storage, distribution, or manipulation of information. The precise accuracy of that figure is debatable, as are the policy implications which some have sought to draw from it. Nevertheless, it is quite apparent that we are moving unambiguously towards an economy in which the production and distribution of information is a dominant element. Communications is not merely indispensable to that information economy; it is increasingly inseparable from it—a fact which poses some vexing problems of public policy (about which more later).

New information and communications technologies and the services they provide are among the wonders of our age. Not least of the wonders is the recentness of their appearance. In three generations, we have seen the telephone develop from a device that executives of the Telegraph Co.(now Western Union) dismissed as “hardly more than a toy or a laboratory curiosity” to an instrument whose bell is heard around the world. In two generations, radio has developed from crystal sets into the ubiquitous television tube found in 97 per cent of American households (where it glows an average of nearly seven hours a day). In less than a single generation, the computer has been transformed from a five-ton machine with 500 miles of wiring to a handheld calculator capable of performing in seconds calculations that would once have taken days, even weeks of effort. And in this same generation, satellites have developed from Buck Rogers fantasy into an operational system for global communications.

One may notice from the sequence of these examples that the time period of development has constantly diminished. Modern communications technology has advanced in the last decade as much as or more than in the previous century, and the accelerated innovation shows little sign of abating in the near future. It is now obvious that the pace of technology has begun to overrun the assimilative capacity of our political and social environment. Nowhere is this more apparent than in the case of electronic communications. The quantum leaps in electronics technology and potential services have shown us a future which our social institutions have scarcely begun to grasp. Worse yet, the gap between what could be and what now is seems to be widening every year.

For example, we were told only a few years ago that the emergence of cable television could bring as many as 30 or 40 channels into virtually every American home, providing entertainment, information, education, and an unimagined (unimagined, that is, by us ordinary folk) array of one-way and two-way communications services—teleshopping, telebanking, teleconferencing, and tele- just about everything. To millions of Americans who have developed the finger skills of a master safecracker in trying to tune their sets to get one viewable picture of Walter Cronkite, this new superhighway of communications was a rich promise indeed. Today the promise is even richer, since the potential capacity has increased by, as engineers are fond of saying, an “order of magnitude.” With the development of optical fibre communications, yesterday’s cable is to modern communications capacity as the Volkswagen bus is to the 747. A single glass fibre, spun as fine as a human hair, will provide a capacity for three television channels, which in themselves have a huge capacity for information (and a near infinite capacity for banality). A small bundle of such fibres could carry all the communications for which we have any beneficial use (as well as some for which no such use can be conceived). Meantime, waiting for the future to arrive, millions still struggle for the one or two or three viewable signals to which present circumstances, in part the product of past regulatory policies, have resigned us.

Looking to the future, some view the social implications of the new technology with foreboding. A year ago, walking down a main street in Aspen, Colorado, I passed a sign that read: “1984 is only eight years away: are you ready?” Presumably the point of the question was to warn that unless we behave we will fall victim to soulless technology and tyrannical institutions, or tyrannical technology and soulless institutions, whichever seems most frightening. But the 1984 label is misleading as a forecast of things to come, at least in the next score of years. There are, of course, legitimate and substantial concerns about how communications technology and government power will intersect in the future. And, apropos of 1984, some of these concerns relate to government control of communications to suppress individual rights and freedoms. But none of these concerns supports the dark visions of future horrors which we associate with Orwell’s celebrated book. In fact, from what one can see today, the most plausible forecast shows not an all-powerful government using its power over communications to control our daily destiny, but a government which, with the best of intentions, is unable or unwilling to grasp the nettle of hard policy choices and to direct communications technologies and services in socially useful ways. I should amend that. It is not so much a question of government, as such, having control, for the primary initiative should probably remain in the private sector. But government obviously has a role in structuring and regulating the private sector, both to restrain monopoly power (where it is not feasible to eliminate it) and more generally to ensure that communications technologies are socially productive. Moreover, there are “public goods” (as economists would label them) aspects to communications systems that require government to exercise a positive role in the design, development, and use of such systems. Plainly, therefore, there are issues and problems that government must address.

Alas, as things currently stand, it appears that government, far from being a solver, has become part of the problem. Instead of giving direction and social purpose to evolving technology, it has meddled with it fecklessly and sometimes even mischievously, Far from seeking to advance some general conception of a broad public interest, government policy, particularly in the regulatory area, has too often been characterized by a series of narrowly conceived measures whose primary purpose has been the compromise of competing private interests or the correction of some immediately perceived but transitory problem. But I anticipate. Before proceeding further in this vein, it is necessary to identify what some of the problems are. The following list is selective and suggestive rather than comprehensive and detailed. It is enough simply to suggest the nature of the agenda as we consider the future of the new communications.


Electronic mail and the role of the Postal Service. Of the policy issues that appear on the immediate horizon, none is a better illustration of current institutional failures than the Postal Service. Its difficulties, which are well known if not widely understood, are not traditionally identified as a communications issue. As will be noted, that is part of the problem. Most public and congressional attention has been directed to such matters as organizational and managerial inefficiencies. The 1970 reorganization of the Post Office Department into the Postal Service was supposed to correct all that. Plainly it did not for a very simple reason: the postal dilemma was not one of organizational structure but of policies—what kinds of services should be provided, what kind of pricing structure should be used, particularly, what services should be subsidized, by whom, etc. Unfortunately, as is evident from current proposals to make the Postal Service a government agency again, there is a strong reluctance to face the real questions. Are the ancient virtues of a post office in every town and daily delivery to every home worth the billions in subsidies that will be required to supply them? How much should be paid to ensure that Aunt Minnie receives daily mail service—and who should pay for it? In raising the question of subsidy, I omit the possibility of increased service rates; though rates undoubtedly will and should increase to meet some of the costs, it is not practical to contemplate increases sufficient by themselves to maintain even present levels of service. Even setting aside the political impediments to such increases, the traffic will not bear it. Further increases will simply accelerate the shift in traffic to other modes of delivery—most notably electronic communications systems.

At this point, the underlying identity of postal delivery as a communications service becomes apparent. As the labor and transportation costs for mail delivery soar to new heights, the volume of mail carried by the Postal Service is already beginning to decline, and it will almost certainly decline further with increased competition from swifter and more efficient forms of electronic message distribution. Unless the Service adapts to this new competitive threat, conventional mail will inevitably suffer the same fate as the telegram and the nickel candy bar. There are several major alternatives for the Postal Service. It could choose not to compete in electronic message delivery but merely continue its role in physical mail delivery. Alternatively, it might seek a limited participation in electronic mail through service arrangements, making use of electronic and physical delivery, such as “Mailgram” in which it now participates with Western Union, Finally, it could attempt to offer services in direct competition with telephone and other communication carriers.

Each of these alternatives presents far-reaching issues of policy that are scarcely even being discussed in the public debate over the future of the Postal Service. The first course of action necessarily implies either a decline in revenues which will necessitate huge new subsidies amounting to billions of dollars a year to maintain present services (in fiscal year 1976 the deficit was in excess of one billion dollars; estimates indicate a steady increase in deficits for the future even with reduced levels of service); or, else a total restructuring of postal service (in particular a large contraction of the present service structure). The second alternative is not much more promising. A postal system based on physical delivery holds only modest promise since such delivery is likely soon to be obsolete for much of the mail that is most remunerative to the service, namely first-class mail. Some 70 per cent of all first-class mail consists of so-called “transactions mail” (financial statements, bills, checks, etc.), much of which requires no physical message form at all. It is probable that a large part of this mail will shift to electronic communications. With it will go a major part of the source of revenues from which the service subsidizes other users. Loss of this business to electronic communications carriers will thus not only force a contraction in the Postal Service but also a radical revision of its rate and service structure.

The third alternative, full scale entry into electronic communications, now seems improbable given the political constraints, Opposition from the electronic communications carriers to new competition would be certain to arouse intense political controversy, as past efforts by the Postal Service to provide a commercial offering like photocopying have done. Political factors aside, present management attitudes do not encourage one to believe the Postal Service will strike out in bold new ventures involving competition in the private sector. At most, one might look for modest expansion of services such as Mailgram, or perhaps facsimile delivery. Even if the service attempted full scale entry, it is doubtful whether it could succeed in competition with the communications firms, which are more experienced, more technologically advanced, and which are not saddled with the burden of huge, and largely fixed (at least until existing employees retire) labor costs. But if the attempt were made, the implications for communications policy would be staggering, The effects of competitive entry in the traditionally monopolistic telecommunications field already present some vexing issues of policy, as will be seen; but the entry of a new firm that would rival AT&T in size would make the present controversy pale by comparison. Not least of the problems is that regulatory authority is now divided between two independent agencies, the Postal Rate Commission and the Federal Communications Commission; such a division of responsibility is not unprecedented, as the transportation regulatory scheme illustrates. But is it wise? And what would be the economic regulatory implications of a quasi-public entity competing in private markets?

The foregoing questions are just a sample of those that need to be addressed; yet despite studies of the Postal Service by several groups and commissions, these crucial questions have been only faintly recognized by Congress, by the Executive, or by the Postal Service. There is endless hand wringing over immediate issues—closing of a post office in Arimo, Idaho, or the latest increase in postal rates for Aunt Minnie’s Christmas cards—but negligible attention to the more basic issues that lie a few years ahead. What kind of postal/ communications services do we want, what will they cost, how should they be provided?


Mobile radio. The explosive growth of CB radio has brought with it a new subculture that has caught the fancy of the news media. But if we could look beyond our somewhat faddish fascination with CB, we would see the emergence of a technology that could make mobile radio telecommunications as common as the telephone. Indeed, it is not too much to foresee the development of a system of radio communications that could virtually supplant the fixed wire (or fibre) telephone system of today. The Advanced Research Projects Agency in the Department of Defense is currently developing for military use a form of radio that, technologically at least, is a conceivable substitute for the “plain old telephone service” which is dependent on millions of miles of fixed wire and cable. NASA has successfully developed a hand-held trans-ceiver capable of communication with a domestic satellite; with this radio, a person on the street in Bangor, Maine can talk via satellite to San Diego, California. The economic implications of such a system are apparent: the entire telephone industry as we know it (and as some love it) could become technologically obsolete in a very short period of time (shorter than the amortization for current investment rates contemplate). Should we be concerned? Economic questions to one side, what are the social implications of such a system? Do we want telephones in every car? In every pocket? For unrestricted public use? Limited services? If the latter, what kind of service? Again, these questions, elementary as they surely are, have not yet appeared on the agenda of policy issues. Virtually all of the debate on policy so far has been focussed on questions of frequency allocation—questions which are logically dependent on answers to questions of purpose.

To add still further to the complexity, the increased use of high frequency radio may conceivably present a health problem as a consequence of radiation. Unfortunately, little is known about the dangers of nonionizing microwave radiation, but enough is known to justify concern and further study. Obviously, the problem is not special to mobile radio, or to satellites (ordinary television broadcasts, or relay transmissions may present these same problems even today), but the pervasive use of radio, and in particular the diffusion of mobile transmissions hypothesized here could magnify the problem.


Broadband communications. As noted earlier, when cable television burst on the scene in the 1960’s, it brought with it promises of a wired nation in which coaxial cable would bring communications and information services in abundance. The promise has dimmed somewhat, partly due to economic constraints and partly to restrictive regulatory policies, particularly those of the FCC. Since the 1960’s, the FCC has smothered cable television under a code of rules and regulations so complex that a whole new legal priesthood has arisen to interpret and apply them. In the main, the rules have been aimed at protecting the broadcast industry against competitive injury, thereby preserving the virtues of free local television services—virtues the commission declared to be the cornerstone of regulatory policy in 1952 when television was an infant, and cable was unborn. To preserve those virtues (and, not quite incidentally, the profits of the broadcast industry), the commission has effectively relegated cable to a secondary role in the nation’s communications systems. The wisdom of the FCC’s policies has been much debated, but perhaps the most interesting question is not whether the policies are correct (I have no doubt that, in the main, they are not), but whether they can in any event survive.

The promise of universally available broadband communications, which faded in the early seventies, has now been revived by rapid developments in optical fibre communications to the point where optical fibre can now be seriously considered as the basic delivery mode for conventional telephone systems. Needless to say, this prospect introduces new complexity. If the telephone company decides that it is economically feasible to replace conventional telephone lines with optical fibre, I assume the FCC will not prevent it from doing so. But, once the fibre is in place for telephone use, will the FCC retain the current regulatory restrictions on the number and character of television signals which are carried on cable? If Bell does replace its lines with fibre, it is hard to imagine that the FCC could think of a public interest rationale for continuing present cable television restrictions.(It is also doubtful that the present FCC rules forbidding telephone ownership of cable systems could survive, though presumably the carrier might be restricted simply to leasing channel use to others.)

But what will we do with such a system? How will we use it? Who should control the system and on what terms? For example, apart from the obvious use of broadband television in providing more outlets for Norman Lear, what are the uses and application of this new superhighway? What kinds of public services should we expect and how can they be secured? What is the role of regulation in this new system? Beyond customary regulation of common carrier obligations and assuring reasonable access to the system by users, is there any role for regulation? In a system which provides not only dozens of different channels but also the means for the selection of programs by the individual viewer from a central library, is there any basis for a fairness doctrine, or an equal time rule, or a family viewing hour?


The role of print media in an electronic society. Since the first appearance of radio in the 1920’s, it has been fashionable to predict the disappearance of the print media. For some futurists, the only speculation has been not whether, but merely when, books, newspapers, and periodicals will be relegated to museums to be displayed with stone carvings and papyrus scrolls. One can envision a time in which virtually all news will be conveyed by electronic channels to the television set—with perhaps a printer connected to the set for those who still want the comfort of “hard copy.” Surveys show that most people already rely on radio and television as their main sources of news. And, at least as a matter of technological speculation, it is easy to conceive that tape cassettes, video discs, and two-way communications channels, not to mention ordinary one-way television, could substitute for books and periodicals. The technologies required for this to happen are well developed even if not yet widely used. Yet, whether, or when, these forecasts will come to pass is not so much a question of technological potential as it is of economic circumstance and cultural acceptance. With respect to both, the future is less settled than is sometimes made to appear. Per household expenditures on nonprint media surpassed those for print media nearly a decade ago, and the divergence between the two is almost certain to continue, At the same time, however, expenditures on print media have continued to rise in a manner which belies any simplistic notion that the end is near. As for cultural acceptance, the evidence, such as it is, follows about the same pattern as the economic indicators. Studies indicate that television viewing has far surpassed reading as an activity of adults and children alike. On the other hand, the public passion for television has not altogether replaced its affection for print, as the recent phenomenon of Roots illustrates: at the same time the television series attracted the largest audience in history, book sales rose to unanticipated heights.(Some quantitative corroboration can be found in copyright data: in 1972, for instance, more than 100,000 books and 85,000 periodical series were filed with the copyright office.)

If the future of print is ambiguous, so are the implications for public policy. Assuming a decline of the print media is a likely outcome of present and projected future trends, should we be concerned? While some believe that the displacement of print is a natural and necessary event, others are deeply apprehensive about such a possibility. The objection to electronic substitutes is partly utilitarian. For example, electronic media do not permit easy random access; they discourage rereading, or thoughtful deliberation on content; electronic facilities are not as portable as print (it is hard to read a view screen standing up in a bus); and there is a question whether we will be able to retain the same diversity of content with electronic media as we now enjoy with print.

Yet the concern over the fate of the print media clearly expresses more than a utilitarian consideration. There is also an anxiety about the cultural implications of reducing Melville and Dr. Seuss to magnetic tapes, or of relegating The Virginia Quarterly Review and Donnesbury entirely to television. Probably the anxiety reflects a romantic attachment to the traditions of the printed page, and perhaps an elitist attachment as well (electronic communication, as we now know it, is preeminently a popular medium). But even in a technologically modern and thoroughly democratic society, there is surely some room for romanticism, tradition, and even elitism; and if the print media reflect no other values than these, perhaps we should reserve some room for them in the coming electronic age. Still, even assuming some government intervention is appropriate, what can be done without compromising the tradition of independence on which the value of newspapers, magazines, and books rests?


Boundaries of monopoly, competition, regulation. In the past decade, the FCC has authorized a modest but promising degree of competition in private line telephone services and in the supply of terminal equipment interconnected with the telephone network—areas hitherto the monopoly of the telephone company. AT&T has resisted the new competition with arguments, artifice, and now proposed legislation designed to restore (in large measure) its once quiet monopoly in the areas opened to competition. In further response to Bell’s efforts to halt the new competition, the Justice Department has filed an antitrust suit against AT&T. The emerging conflict pits the largest company in the world (as well as other telephone companies and assorted allies including the communications workers union and most state regulatory commissions) against IBM, ITT, and other electronic equipment manufacturers, all specialized common carriers, the FCC, and the Justice Department. One might suppose that an open conflict between such adversaries over such a basic issue as the respective roles of competition and monopoly would be the occasion for a far-reaching public debate on public policy. Maybe it will be. To date, however, the level of public discourse has generally not risen above an inconclusive and highly technical debate over the effect of new competition on the telephone bill of the proverbial little old lady in Pasadena (who, for reasons not clear to me, is always depicted as wearing tennis shoes). Bell and its allies maintain that competition will skim the “cream” of monopoly profits from lucrative services, where competition has entered, and thereby remove the source of revenues with which it subsidizes residential phone service. The FCC and its allies dispute such an effect. Interestingly, neither side seems willing to face up to the underlying question: why do we care? Is the current subsidy—assuming it does exist—socially efficient or equitable? What are the trade-offs between higher residential phone bills and the efficiencies of competitive services and pricing generally? The issue is essentially the same confronted in the case of the Postal Service, where anxiety is expressed over Aunt Minnie’s mail service. Here, as there, the crucial issue is being largely ignored in the pursuit of factual questions.

With the new competition in telephone services, subtle questions are also emerging as to the regulatory role and the definition of regulatory boundaries. Perhaps the best illustration of the problem is the commission’s efforts to define the regulatory boundary in the face of increased integration of communications and data processing. The FCC has tried to walk a tightrope between regulating communications devices and services on the one hand and not regulating data processing devices and services on the other. As indicated in several recent cases, however, the boundaries between the two have become so vague that it is all but impossible to make a sensible judgment as to whether something is “communications” or “data processing.” On first appearance, the problem seems to be a technical one, but at bottom it is not. The policy issue that underlies the controversy is simply whether or not particular services will be regulated or unregulated. For example, AT&T is bound by a 1956 consent decree which effectively prohibits it from competing in unregulated markets for data processing equipment and services. AT&T appears to be happy with the consent decree so long as it is permitted to manufacture and sell terminal equipment under the label of “communications” devices. But the consequences of allowing it to do so may very well be to require that regulatory jurisdiction be extended to all manufacturers selling similar devices and services. If such devices are regulated communications devices when made by Bell, are they not the same when made by a growing number of computer firms? The FCC in 1966 sensibly concluded that it should not try to regulate the computer industry. On the other hand, it is understandably loath to lock Bell out of a market which is as much communications as it is data processing. As it happens, this problem has a relatively simple resolution: permit AT&T to compete with IBM and other data processing manufacturers, but remove regulatory restrictions on the sale of such devices and services except for rules designed to prevent subsidization of competitive services by monopoly services. Whatever reason may have existed for banning AT&T’s manufacture and sale of unregulated services and devices no longer holds. Nor is there any justification for regulation of terminal equipment, which is supplied or is capable of being supplied in a competitive market. Nevertheless, under the present laws and policies, we are being driven to choose between two unacceptable alternatives: barring AT&T from the entire field of integrated communications/data processing (treating it as “data processing”) or permitting AT&T full entry into the field under a rule that implies that the entire field is subject to FCC regulation (treating it as all “communications”).


International implications. When the international implications of the new communications are viewed, two quite distinct sets of issues emerge. One is a group of rather technical questions concerning domestic industrial structure for international communications which are similar to those we have seen in the area of domestic service. The issue arises particularly in the international record service, where the FCC has made some modest efforts to introduce more competition in what has historically been an oligopoly cartel to stimulate lower cost and higher quality service. The efforts make sense as far as they go, but they do not go very far. The one most promising and potentially most innovative competitor in the field—Comsat—remains frozen out of competition by an outmoded policy of restricting Comsat to the role of carriers’ carrier. This curious restriction (which may or may not have been intended by Congress—it is debatable either way) has a twofold inhibition on competitive service: it prevents Comsat from providing service direct to end users (who must go through one of several record carriers or the exclusive voice carrier, AT&T), and it precludes entities other than common carriers from brokering services for domestic users.

While some of these issues appear to be purely domestic policy concerns, ultimately they have international effects. This complicates the problem because of two biases that are prominent among foreign communications systems (virtually all of which are owned by their respective governments) and which run counter to U. S. biases, One is a foreign distrust for competition, even when it is on the other side of the ocean, and the other is a preference for costly undersea cable systems (for which many foreign firms are large suppliers of cable) over satellites (chiefly supplied by the U. S.).

The conflict between U. S. and foreign interests in domestic industry structure is but a part of a growing tension between the U. S. and other nations over international communications generally. American dominance in modern electronic communications has provoked fears and resistance to new information and communications facilities and services. In large measure, this reflects simple economic protectionism against competition, As such, it is but part of more pervasive strictures on international trade and commerce. But even within this frame of reference, the economic importance of information and communications services and U. S. leadership in this area clearly justify a special concern. Moreover, there is another dimension to the problem which makes it special, and this is the foreign fear of U. S. cultural dominance or, in the words of Third World rhetoric, “cultural imperialism.” This fear has surfaced most notably in discussions over international, direct broadcast satellite service, but it also manifests itself in other areas—for example in the export of U. S. television programming. The anxiety is probably deepest in the emerging nations of the Third World, who, perhaps correctly, see themselves as especially most vulnerable to the cultural corrosiveness of Wonder Woman and Hee Haw. But even in Canada there has been some restiveness of late— though its objection so far runs only to imported American commercials, not to Maude or Kojak.

This complaint of cultural imperialism finds an unreceptive audience among those in this country who trade in ideas and information. Such claims are widely regarded as a cover-up for economic protectionism or as cultural jingoism or both. There is good reason to take some of the rhetoric at less than face value. A good deal of the breast thumping about protecting indigenous social and cultural values is both disingenuous and exaggerated. On the other hand, we ought not to indulge the righteous presumption that only foreigners engage in such base behavior. When the Corporation for Public Broadcasting made a deal with the BBC recently for the latter’s production of Shakespeare’s plays for U. S. public television, the American Federation of Television and Radio Artists vigorously objected not only to the “export of jobs” to Britain but also to the effects on the patriotic sensibilities of American school children (the plan is to distribute the series to schools for in-school viewing, as well as viewing by the general public). Setting aside, however, the question of whose national heart is purer in the international arenas of debate and discourse, we cannot ignore the resistance to the free flow of information and ideas. Whether the resistance stems from economic, political, or cultural interests (or, most likely, a combination of all), it rests on foundations of national sovereignty that we are bound to respect. To walk too softly or to wield too big a stick over the issue could not only impair our international relations but also stimulate greater restrictions on the international communications so vital to world understanding.


This has been a rather brief discussion of future communications policy issues, but it is at least suggestive of the kind of questions that confront us. Sad to say, the consideration that is now being given to these questions by those in a position to respond to them is rather fitful, arising erratically as some particular event forces attention to a problem that implicates long-term policy. Even where an unusual event virtually forces a major policy issue to the forefront, the depth of discourse, in public, political, and regulatory response is typically shallow.

At least part of the difficulty stems from a failure to observe the changes which technology has been made in the underlying assumptions of established policy. The 1934 Communications Act was premised on technologies of limitation. Radio waves propagated at large can collide with and nullify each other, hence the licensing and limitation of broadcast outlets. One set of wires running down the street or across the countryside can connect all telephone subscribers, without wasteful duplication, hence the regulatory barriers to entry into point-to-point communications markets. But the philosophy behind these restrictive provisions was not conceived or designed for later technologies of such diversity as microwave, satellite, microprocessor, coaxial cable, or optical fibre. It was ignorant of the computer and of the present explosive growth in data communications; and it could not imagine the development of new services like broadband cable, citizens band radio, electronic funds transfers, video discs, facsimile transmission, teletext, or telemedicine. This combination of old regulatory concepts and new technologies has yielded the anomaly of rationed abundance. No doubt it is possible, as ancient folklore teaches, to have too much of a good thing. Still, if that is the problem, one would like to have it articulated in those terms. In fact, no such subtlety is evident in our present policies towards communications. The FCC, for example, has said a lot of things in defense of its restrictions on broadband cable, but so far as can be recalled they do not include a warning that too much information would be harmful to our health. The commission and virtually everyone else with policy-making authority have simply refused to acknowledge that the issues have changed, that the central problem for regulatory and social policy for the future is less a matter of rationing scarcity than of managing abundance.

Some suppose that the key to a fresh look must begin with Congress and a revision of the fundamental law that ostensibly directs present policy, the Communications Act of 1934. The House Communications Subcommittee has undertaken such a task. This is a commendable effort. Providing it results in a more directed and more current congressional mandate, a revision of the Act could remedy a notable deficiency in the present vacuous directives written by Congress in a different time and in different circumstances and for largely different purposes. The basic radio sections of the statute were written in 1927 for a technology of scarcity and for a crisis long since past; many of the basic common carrier provisions were written for regulation of the interstate transportation in the early railroad era. But a statute is only the skeleton of our institutions, and we must look beyond the bare bones to what gives life to them.

Virtually since its inception, the FCC has been a target of relentless criticism, As a former member of the commission, I should be hesitant to join in throwing rocks at the FCC because some of the stones that are thrown at the FCC’s glass house for past misdeeds could be aimed at me. But despite my arguable complicity in some matters, I cannot resist hurling a few stones.

Of all the criticisms that have been made, the one that comes closest to a universal complaint is the charge that the commission is a captive of the industries it regulates. The complaint is not special to the FCC; every regulatory agency has been the object of this complaint. It has in fact become a kind of symbol of all criticism, a simplifying, unifying expression of discontent with regulatory performance. According to the received wisdom, the growth of administrative government goes something like this: A social or economic problem arises, to meet which a regulatory agency is created and given large and ill-defined powers. Initially the agency attacks the problem with innovative zeal, but the zeal wanes; the agency develops a familiarity, then a sympathy, then an identification with industry interests.(In the case of an agency such as the FCC with jurisdiction over several, conflicting industries, the lesson becomes a bit more complex, but it must be remembered we are not looking for literal truth.) The process, as I have described it, is rather reminiscent of one of Alexander Pope’s homilies on the subject of vice: “Vice is a monster of so frightful mien as to be hated needs just to be seen. Yet seen too often, familiar with her face, we first endure, then pity, then embrace.”

There is substance in this popular folk wisdom about the regulatory process, but like most such wisdom, it takes quite a few liberties with the facts. At the very least, the term “industry capture” is misleading insofar as it suggests that something invidious or unethical is afoot, Watergate notwithstanding, cases of unethical behavior, among federal regulators at least, are truly exceptional. A more important weakness of the industry capture thesis is that it personalizes what is often an institutional bias of regulation itself, In fact, with very few exceptions in American history, regulation has been promoted and extended either with the consent or on the initiative of the business interests that are the subject of regulation, as a means of protecting industry against competition. Thus it is not that regulators have become tools of private interests, but that regulation has become a tool of private interests. Industry may complain about regulation, but given a choice between regulation and competition it will choose regulation every time. So it is in the economy in general, and so it is in telecommunications as well.

Despite the symbiosis between regulator and regulated, and despite continued grumbling about regulatory inefficiency and ineffectiveness, public opinion surveys indicate a majority of Americans still favor regulation on the apparent belief that it is better than the next best alternative. Na?ve though that seems to me to be in many cases, it does sensibly suggest at least that the measure of agency performance should rest less on its embrace of regulation as the norm of government policy than on the character of the regulation embraced. Unfortunately, the FCC does not score well on that test either. The characteristic that best marks its approach to regulatory policy is a failure of vision—a pre-occupation with trivial concerns of ephemeral, if any, importance. Policy planning has become almost an incident of managing daily routine.

Equally characteristic is a tendency to resolve issues of public controversy through arbitration of private disputes— witness cable television, in which a huge and complex edifice of regulation was openly constructed on a private compromise agreement among broadcast, cable, and program producer interests. This private interest balancing is a pattern that is pervasive in our scheme of communications regulation. The theory, if there is one, is evidently that there is nothing more to the public interest than a government-sanctioned accommodation of private interests. This approach to public policy may be inevitable in a society with pluralistic values and often highly polarized interests; and probably it is in the honored tradition of democratic, political governance. After all, interest conflicts do not disappear simply by chanting the words “the public interest” three times, and, indeed, the public interest is not something grandly aloof from the amalgam of different private interests that lie beneath it. Thus, compromise, accommodation, and balancing are essential elements of any determination of The Public Interest. Yet there must be something more involved in governance than simply the arbitration and settlement of private conflict, Ultimately, some appeal must be made to a conception of public welfare broader than the immediate interests that contend for recognition before the agency. That appeal is too little and too softly made in the field of communications,

These comments may be too uncharitable towards the FCC, for it has made some notable strides forward as well as backwards. In any case, warts and all, it may yet be the “fairest” hope for the future when the entire scene is canvassed. In the executive branch, the one agency charged with general communications policy concerns—the Office of Telecommunications Policy—has been nearly destroyed as an effective instrument for policy development as a result of Presidential abuse (under Nixon) and indifference (under Ford) as well as shortsighted congressional criticism of the agency for daring to take an interest in such matters as broadcast policy—which Congress supposes to be the exclusive preserve of itself and the FCC. In the absence of a coherent framework for coordination, other executive agencies with important communications functions have pursued their individual courses with little if any conception of the larger policy implications that transcend their functions, NASA and the Department of Defense and others spend hundreds of millions of dollars each year in research on communications technology and services that could have enormous policy implications for nongovernment communications. There is little evidence of coordination or effective communications among such agencies themselves or among them and the FCC. For the most part, the same is true of the several executive agencies such as HEW, the Department of Agriculture, and the Department of Commerce, which spend millions each year in promoting communications systems or services. It is not necessary to suppose that all of these activities can or should be unified into one global communications effort to ask that they be coordinated and directed in a way that considers the effects on communications beyond the respective sponsoring institutions. Surely the work of, for example, the REA in supporting rural telephone systems could be fruitfully coordinated with that of HEW in supporting communication services, and both might profit from an alliance with the FCC to ensure that their respective policies are not at cross purposes.

Then there is Congress. Whether or not Congress responds expeditiously to the need for a new legislative charter, it must attempt to provide some positive direction, at least on the broad policy questions. If Congress is to play an important role in the future of telecommunications, it will have to transcend its past preoccupation with television programming and grapple with other issues such as I have mentioned— issues not as colorful and publicly notorious as televised sex, but probably more fundamental to the operation of the system. Congress must also examine the economic realities of mail service today and tomorrow, It may be that Congress is incapable of dealing with issues that are not in the center of popular public controversy. If so, responsibility and power will inevitably continue to shift, as it has in the past, to those who seek responsibility or who cannot avoid it.

We can, of course, continue to muddle through as we have. Plainly there is not the same sense of urgency about our communications system as there is about such matters as inflation, unemployment, energy, environment, crime, transportation, and health. After all, we probably still have—as the telephone company and the broadcast industry are too fond of telling us—one of the best, if not the best, communications systems in the world (at least if, for present purposes, one does not count postal delivery as part of our communications system). However, neither the absence of a crisis nor the relative quality of our communications system compared to that of Uganda seems a creditable reason for ignoring the need to improve the dialogue on real and important issues of public policy. Indeed, it is the very absence of a crisis which most commends the present as a time for addressing emerging issues of communications policy in the relative calm (all things are relative) which such occasion affords and while the problems are still manageable. Probably only God can do much to resolve our energy problems, but in communications we can still do what needs to be done ourselves.


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